We keep hearing that sheep and lamb prices are at record levels. But I’ve spent some time this week looking behind those headline numbers, because there’s an obvious question worth asking: are livestock prices really at record levels, or has inflation simply made the numbers bigger?
To find out, I went back through around 526 weeks of National Trade Lamb and Mutton Indicator data, covering the past ten years, and adjusted historical prices for CPI to put them into today’s dollars. Over that period, Australia’s general price level has increased by roughly 30%. So, as a simple comparison, 600 cents a kilo ten years ago is worth somewhere around 800 cents in today’s money.
Even adjusted for inflation, the market still stands out
Once we allow for that, the current market still stands out. The National Trade Lamb Indicator reached around 1,244 cents a kilo in July. After adjusting the entire ten-year series for inflation, that ranks as the second-highest weekly trade lamb price in real terms. The only market to beat it was back in 2019, when around 980 cents then equates to roughly 1,255 cents today — a difference of less than one per cent.
Mutton went one better. At around 916 cents in July, it established a new ten-year record even after inflation.
Now, importantly, markets don’t move in straight lines. We’ve seen a correction over recent weeks: trade lamb has moved from that July high of around 1,244 cents back to around 1,170 cents, a correction of roughly 6%, and mutton has also eased from its peak. But a correction from record levels doesn’t necessarily mean the underlying story has changed. Even at current levels, we’re still looking at livestock values at the very upper end of what we’ve experienced over the past decade.
So this isn’t simply inflation making livestock look expensive. Sheep and lambs genuinely are trading at historically high real values.
What are we going to do with it?
And that raises a bigger question: what are we going to do with it?
Particularly here in Western Australia, we’ve spent plenty of time talking about declining sheep numbers, uncertainty and transition. Maybe it’s time to change the conversation, because record prices alone won’t rebuild an industry.
The challenge now is to turn price confidence into production confidence — confidence to retain breeding females, invest, increase production and believe there’s a profitable long-term future in sheep. And that requires more than today’s spot price. It requires competition, market access and greater visibility around future returns.
Forward contracting is a step in the right direction
One encouraging development we’re seeing is the growing acceptance of forward contracting, particularly for feeder lambs. We’re now seeing increasing numbers of producers and buyers prepared to look beyond today’s price and agree on minimum or forward pricing for lambs that may not be delivered for several months.
That’s pleasing, because giving both sides greater visibility and an ability to manage price risk is part of building confidence. But it’s only the beginning. If we’re serious about rebuilding production, we need to continue developing practical ways for producers to see and manage some of their future market risk — rather than asking them to produce first and discover the price later.
Use the record, don’t just celebrate it
So perhaps the opportunity in front of us isn’t simply to celebrate record livestock prices. It’s to use them — to build confidence, improve market signals and give producers more reason to invest in tomorrow’s production.
Because if historically high real livestock values can become confidence to produce, these markets may ultimately be remembered for something far more important than setting records. They may help change the direction of the industry.